tv The Communicators CSPAN October 9, 2010 6:30pm-7:00pm EDT
>> here is who is joining us today. michael powell served as chairman of the sec from 2001- 2005. kevin -- fcc from 2001-2005. thank you for being with us today. if we could, let's start with a question for all three of you. there has been a lot of talk in congress and in the fcc and among interest groups about three banding -- re-banding some of the 20th century telecommunications laws for a 21st century world. do you think the fcc is capable of managing the current telecommunications world? if you cut, how would you change the current laws? >> this is only a one-hour
program? [laughter] is the fcc capable? absolutely. one thing we can all agree on is that under all of the chairman, this agency has continued to have a lot of expertise, a lot of integrity. it has not been plagued by scandal. it is an example of a government that works. it is a model that we as a country would love to see in other countries. we would like to see independent regulators. we would like to see expert regulators who are more independent of the political process. we would like to see that all throughout the world. i think it is a very good model. it does not mean that we need to regulate everything that moves,
but it does mean that the american people are looking at an agency that works. should we have 21st century regulation in the 21st century? well,yeah, it makes sense to keep up with the times. one of the major issues that there for us to be dealt with, relevant to the next 10-20 years, we have to have a way to get more spectrum to places where it is unused or not used in an adequate manner into the private sector. spectrum is the platform for the development of a wireless industry, and that is where we are going to be going for job growth and productivity gain. that is a very, very important topic. number two, we need to have certainty for industries about the future of regulation so that american companies that want to
invest understand how to make calculations about the possibility. american corporations are sitting on unused cash at a record amount. that could lead to a terrible problem of unemployment. we need to have the opportunity for investment to be clear so the american corporations can take the cash out of the tiller, but it to work in the market, and create jobs. >>, think the commission has the tools it needs, but certainly regulation would help. michael has been calling for that since he became chairman. early on he tried to get congress to revamp the legislation to try to give us more tools to deal with the convergence that was occurring across platforms. i think the commission has the tools to continue to do what is necessary. >> what would you like to see done? >> i think an important part of the legislation is trying to find a way to create a more
level playing field. the current silo approach has been evaporated by the news of ip platforms -- use of ip platforms across various technologies. >> the fcc is a competent agency, but one that spends its entire life in court. that is because the statutes are increasingly ambiguous when applied to the technologies that are driving the market. the laws are built around technologies and economic models that pre-date the internet. if you provide cable services you live in this bucket. if you provide telephone services, you live in this
bucket. as we all know, the rise of the internet means that distinguishing communication strategies based on the pre- internet laws is a recipe for confusion. increasingly, i just feel like we have a statute that is now a grey.ant source of r it is a very slow process against the march that is really, really fast. there is a whole new crop of powerful companies that are probably as a significant or more trips more -- more significant in driving communication then the traditional players.
and yet, in some significant ways, they live in a world completely outside this conversation on the periphery. i think they need to be brought in in a more coherent way. >> how is it today live outside the conversation? >> i would say that they like to live outside the conversation in that they have not been regulated by the fcc in many ways. the company's michael is talking about have spent a lot of time talking to all of the fcc chairs about ways to shake the platform. facebook, google, yahoo.com up all of these companies exist on a physical network, on a platform that is regulated by the fcc. the shape of the platform is very important to their business prospects.
you need to bring of the beneficiaries and the network providers into the same conversation. you need to strike a balance, because without enough money to build the networks, you do not have enough of a platform for these other companies to build on top of. >> the different platforms and different technologies are regulated in different ways. there are some services that go over the top. 911 provides a voice service regardless of what kind of technology you are using. i think it would be good to address that in a more systematic fashion. >> when you talk about google and these other companies, we are regulating based on who you are and where you came from, not what you are doing. for a 19-year-old having a
telephone conversation over skype, there is no significant difference between doing that on the computer or on the telephone, but there is a huge regulatory difference. i always challenge my neighbors to ask their kids to name the broadcast networks. i do not think my kids have any idea that there is a difference between channel 7 and channel one of seven -- channel 107, and yet the regulation is radically different for channel 7 and channel 107. i think i cannot be sustained for very much longer. >> when congress comes back, depending on what happens this fall, it is likely they are going to look at doing a telecom to rewrite. would you all agree that maybe
they need to take a look very broadly at rewriting this entire statute? >> i would say this. it depends on what problem congress is trying to solve. the 1996 telecom act was meant to remove barriers that kept businesses from competing with each other. the modified final judgment said to the bell company that you cannot go into these adjacent markets and the long-distance industry had no way to go into local markets. the fundamental premise was, let's remove the barriers and let the industry's invest in each other's markets and all of that new investment will produce technological change and innovation and job growth. what happened? well, the law was not the only reason that the following happened, but it was a contributing factor. weremillion jobs -- tw0.1
created. these are great success stories. of all of the extra revenue that led to president clinton balancing the budget, one-third of the extra revenue came from growth in the and the icc sector. it is a great story. if congress wants to rewrite regulations to drive investment, and that is terrific. if they want to do it to pursue an ideological agenda or entrench a monopoly, those are bad reasons. it depends on what problem congress is trying to solve. >> the real reason for the 1996 act was the unraveling of the 1984 antitrust suit against at&t. it was really about competition
between long distance and local companies. but today, there is no such thing about long distance. the cellular telephone industry largely crushed that as a category. yet, a fundamental organic statute still has mechanics that are all about this competition. >> the long distance companies wanted the law changed so that they could go into locals. the locals wanted to go into long distance. the over the top companies, google, facebook etc., they do not want to go into the service provider business. the service providers do not want to be another google. we do not have the same, let's fight each other, attention that made the 1996 act a pro- investment act. what would be the purpose of a new law? would it be to cut a better deal for the content company's
relative to the networks, or cut a better deal for the networks relative to the content companies? when congress gets into the business of saying, would like to take money from your pocket to put it into that guys pocket, that is not a pro-jobs agenda. it is not what i think you would want the next congress to start doing. >> i would say that the corporate issues that surround the internet from a regulatory standpoint now are much broader and more intriguing than traditional telecom policy. i would say that we have serious issues of intellectual property. there is a never ending tension about privacy, companies collecting a serious amount of data to provide targeted advertising to me as a consumer. then there is the holding about net neutrality. that gets to the fundamental
tension. i have no problem understanding why google and at&t might be contemplating their roles. but at the end of the data, it creates a stall in the market. >> but no law denies them. >> net neutrality might. >> but there is no law that needs to be changed. >> top providers are increasingly providing a voice services and media services that are leading to competition. google wants to increase the speed at which they do that. that has implications for the
network operators. >> let's take skype for example. there is some talk that maybe skype should be regulated on a state level. none of us think that is a good idea. this is a fundamentally boundary-less medium. for skype to use something that sounds like a voice does not mean that they should be regulated on the state level as if they were part of the 19th century. >> i do agree with you that anything congress should be doing in this environment should be conscious of pro jobs, a pro- growth.
>> it is safe to assume congress may not do anything this year. it is a fairly hard thing to get telecom rules through congress. >> i think they will initiate legislation in the committee's. >> but since they do not finish legislation next year. what -- assume they do not finish legislation next year. what should the fcc do? >> you have caused this problem, so i feel that you should explain how the jurisdictional thing has all come about and how it will get resolved. [laughter] >> i get blamed for causing lots of problems. >> i am sort of teasing, but i am also saying that it all comes out of this case. >> that case came out of how
they were classifying broadband services. one of the things that is most striking about the debate and about the reclassification proposal was this harkening back to actually the relative balance that the commission needs to achieve between investment and trying to protect consumers. i think what -- while you may not agree with the reclassification, what i think was most interesting was that he was just trying to restore the balanced approach that the commissioner has done. he explicitly talked about the fact that things should be case by case and very specific. these are things that at that time seemed a very controversial, but are now embraced more widely. the approach that everyone seems
to be gravitating toward is to continue on the path to that issue. that does actually signal the direction in which we should be going. >> the chairman does say that, and i would happen to subscribe to it. we first introduced the net neutrality principle. i would argue that they have reached a relatively stable consensus both in the market and among advocates. the notion of returning to the kind of stability is a good one, but we should not act like if you reclassify you are going back to what existed before. that is a radical departure from the way it was before. these companies, for a decade, almost a decade, have proceeded under the regulatory assumption that they are a particular classification. their business models are premised on that. reclassification will completely
turned that out, and it will depend on how successful they are on the second half of that issue. can they comply with all of the regulations that would immediately apply? there is a lot of nasty stuff hiding in title ii that they would have to get through. i think it is messy. i want to say something that i think is really important. the fcc is not the congress. it is a regulatory agency, and then the power it has, it only has by the grace and authority of the congress. i fundamentally reject the suggestion that, oh, if you do not have authority or there is some serious question of your authority, and congress is clumsy and slow, you are supposed to go find a way to get your own jurisdiction and ask because they will not. that is anti-constitutional, if you ask my opinion.
if there is a serious subject, whether the agency has the power it needs to do something -- by the way i think there is way more consensus than the noise would suggest. it is all about how you operational ties -- operational ize regulatory reform. at some point you have to say that this is congress's responsibility. no one should let them off the hook. if you ever looked at the series of court cases, if there is a kind of case where you will get massacred, it is when the judiciary believes that what you're really doing is creating policy that the legislature never gave you. those are the nastiest most vicious opinions that come out of the court. i would hate to see as have a
prolonged, 3-7 year litigation. >> we are all lawyers here. kevin has the particular distinction of having gone to harvard with barack obama. so my colleagues here can take this way down the lawyerly road. what i want to focus on is what michael just said about the substance. i think everybody involved in these discussions agrees, meaning the carriers, the companies, i hope most of the former chairman, pretty much everybody at the fcc, they pretty much all agree to the following. first, anybody who connects to the public internet ought to have a right to publish on that internet, not counting salacious, obscene material, not counting of criminal material,
but in the zone of free-speech, everybody ought to have a right to publish. it is called a nondiscrimination principle is the notion of a fundamental freedom. it should be the rule for the public internet everywhere in the world. it is not in most countries. we should not hesitate to enshrine dead as essential to our idea of the public and -- to enshrine it as essential to our idea of the public internet forever. second, if we are going to have universal service -- and some people might say we do not need it, but as long as we are going to have that, as long as we are going to take from some people who are a little more wealthy and give to others in order to connect them to the internet, it ought to be broadband and not a voice. everyone agrees on that, i think. third, everyone agrees that in order for america to be able to get connected, there ought to be kind of a base line service, a
vanilla-grade service that everyone can subscribe to, whether it is one the bed or 750 kilotons, -- one mb or 750 kb, pat we should let the fcc were to get the details. lastly -- we should let the fcc work out the details. lastly, if people went a higher- quality, faster service, ice- cream with sprinkles, they should be able to go out and pay for that. >> i do not think there is debate about these issues of any consequence. what is something much more dramatic were to occur?
that is not just a tempest in a teapot, that is a hurricane in a thimble, because nobody is suggesting anything beyond what i just said. >> the last bit about the chocolate sprinkles, i disagree. there is a community of net neutrality components who roundly reject even that. it is something we do in every facet of our economy. you should differentiate price as a consequence of cost causing. there is a purist view about neutrality that is that there should be no distinctions for anybody, no pricing differentials for anybody, no
fast lanes, no slow lanes. what is really interesting about that is that those groups who honestly commit themselves to represent consumers are really arguing that only consumers should pay those prices. at the end of the day, there are real costs associated with the networks. these groups are saying that only consumers should be required to pay them. google or whatever should not be part of the cost recovery mechanism. lower economic demographic, you can still be in the cellular revolution because you can still get a phone for $25. why did the fund for $25? because motorola and nokia are asked to pick a subsidize expense. with net neutrality, you say,
no, you're not allowed to charge motorola or not yet to help with that cost. everything has to be at cost. everything has to be $5. -- $500. my concern is this is not the pro-consumer view, it is the view of powerful internet companies. >> one thing that even this debate it demonstrates is that even the highest level principles are generally agreed to. when you talk about how to do it, that is where the debate breaks down. we should be thoughtful in approaching this issue to make sure that there are no unintended consequences i think
the fcc should be very hesitant before they embark on that path. >> we are pleased to welcome three former chairman of the fcc to our table today. michael powell served under george w. bush. reed hundt served under president clinton, and kevin martin served from 2005-2009 under president george w. bush. amy, next question. >> are aware of we could talk a little bit about indecency -- i wonder if we could talk a little bit about indecency. the fcc has not done a lot of indecency enforcement and the past few years because of court challenges. i wonder if you regret pushing for it so heavily that it caused
broadcasters to challenge fcc enforcement on this. >> i think one of the obligations you have to the commission is to enforce the law as written. even the current commission has continued to appeal those decisions. i do not think the commission should be afraid that the court may rule one way or the other. questioning the commission's authority is a good thing because it will help the commission know how to respond in the future. >> kevin makes a good point reporte. it does not matter if you like the portfolio or not, it is a statutory obligation. it is on the bucs. -- the books.
the job proves heinous lee difficult to do because it is fraught with ambiguity. i never found it ed particularly the employable -- a particularly enjoyable part of the job. >> were you watching the super bowl at the moment and that just and timber lake removed the ornament -- at the moment that justin timberlake removed the ornamented? and when it happened, did you immediately say, i am going to find these people? >> of at a neighbor's party on the couch watching the halftime
show. i thought it was racier than usual. all of a sudden, i turned to my neighbor and said, did you just see what i just saw? we were not sure. i went, and fired up my d v r and started rewinding. i turned to my wife and said, "tomorrow is going to really suck the." and it did. i knew we would have to get ahead of that issue as fast as it could just so that it did not completely speed off the rails. >> you became the only chairman in history that was on monday night football. >> i was. >> one last thing about indecency. the real problem here is the way the supreme